OZ Cabbie June 2014
Wow, what a month. The state governments have finally gotten off their collective arses and taken a bit of action against the illegal operation by Uber of its pretend ride-sharing service UberX. However, it has become abundantly clear that their effort has been half-hearted and has therefore had minimal effect. UberX is still operating as if nothing has happened and the regulators appear to have put any further action on hold while they are searching for answers to what is an ideological dilemma. How can they ban UberX when it promises greater competition in the passenger transport market and substantially cheaper fares than taxis?
Well, they could ban it because it is unfair competition, illegal and dangerous. They could also ban it because it will cost them billion of dollars in lost revenue as taxi and hire car operators start to hand back their government plates because their business is no longer viable.
Tim Hoi, in the last issue, asked if it was time for a taxi driver Eureka rebellion against government inaction and Uber. Such rebellion has already taken place elsewhere in the world. In "Here’s a tip for cabbies – compete, don’t strike!" you can read about the reaction by a passenger, who is a fan of both London black cabs and Uber, to a strike earlier this month by thousands of London cabbies. He is not on the side of the cabbies and he sounds like he is a soul mate of Graeme Samuel. The story is written by Mark Ritson and reproduced from MarketingWeek.
However, before you get that far there are two major articles "The ideological rape of 50,000 taxi drivers" and "We are indeed ruled by morons", which deal in some detail with the current threat of UberX to all the stakeholders in the Australian taxi and hire car industries. It’s not often the industry mafia, owners, operators and bailee drivers are on the same side.
For the past three years, ever since they entered the market, I have been a staunch supporter of taxi apps ingogo and goCatch as well as Uber when it was only a hire car and taxi app. All three have improved service and productivity for the benefit of drivers and passengers alike. At the same time they have provided long overdue competition for the networks, which had grown complacent, arrogant and far too powerful. Not surprisingly the network cartels used every dirty trick they could think of to prevent the apps from gaining popularity with drivers, the public and the regulators. UberX has put that battle on the back-burner, at least for the time being.
That’s not to say that I find everything the apps are doing hunky-dory. They have introduced some concepts, presumably modelled on Uber’s ‘surge’ charge, which I find unbecoming even if they will improve their drivers’ income. My question is: When does a tip become extortion?
Earlier this month the Victorian Taxi Families, a group formed by plate owners to lobby against the Napthine Government and its Taxi Services Commission, was urging its members to join in a demonstration against the federal budget. I’m not sure I see the connection.
What the UberX debacle has also diverted our attention from is the imminent flooding of the market with minicabs by removing the regulatory requirement that hire cars must be luxury vehicles. As you know the rule has already been removed in Victoria and almost in NSW where small cars are legal provided they are hybrid. The Queensland Government is currently reviewing its hire car regulations and appears likely to follow the same path.
Our regulators are obviously in a race to the bottom.